I'm Worried About My Jobby
Patrick Ahearn is a senior human-resources manager and a lieutenant colonel in the Marine reserves. He is 43, has three children, a wife, a mortgage, and a station wagon. He came back from Operation Desert Storm in the Persian Gulf to find that his employer had restructured and moved his job to Toronto. Ahearn chose not to go. It was his third downsizing in four years--Shearson Lehman Brothers, Grand Metropolitan, and Northern Telecom. "People are getting sacrificed because corporations are always changing direction, priorities, or ownership," says Ahearn."But every time they lay someone off, a family gets massacred."
Every day, thousands of managers, bankers, sales executives, lawyers, accountants, and other professionals are driven to anger and despair by the hard realities of the changing world of work. The once-solid foundation for millions of middle-class families--the corporate career--is in shambles. The Organization Man of the 1950s and 1960s is being replaced by the migrant manager and free-lance professional of the 1990s.
ALONE AND ANGRY. The pain of change is all around us. Corporations are rushing to cut costs and downsize before yearend. They want to take their lumps in 1991, in preparation for a stronger rebound in 1992. That means an unusually powerful wave of layoffs will sweep through the U. S. during the next three months. Already, the drumbeat of bad news is growing louder. On Sept. 12, Colgate-Palmolive Co. announced that it would trim 2,000 workers from its worldwide work force of 25,000. On Sept. 16, PepsiCo Inc. said it would slash management and administration at its Frito-Lay Inc. unit by 30%, or 1,800 jobs. And on Sept. 19, Time Warner Inc. announced the planned layoff of 105 editorial workers, bringing this year's cuts at its six magazines to about 10% of the total staff of 6,000. And more layoffs areexpected.
White-collar workers at these companies will join the growing ranks of once-secure employees who are finding themselves on the outside--alone, afraid, and angry. Who doesn't have a brother or a sister, a parent or a friend who has lost a job recently? The economic recovery will soothe the pain, but it won't stop it.
Forces of fierce global competition and industrial consolidation are compelling corporations to cut entire layers of middle managers and whole categories of professional staff. Few companies can hide from the intense pressures of international competition anymore.
Yet even as the old corporate career paths crumble, new ones are being built. With big corporations no longer rewarding loyalty and performance with lifetime guarantees of employment, individuals are transforming themselves into itinerant professionals who sell their human capital on the open market. "This is the end of the age of big corporations as employers and providers of health and pension benefits for millions of people," says Charles Handy, visiting professor at the London Business School and author of The Age of Unreason, a book about the changing nature of work. "Instead of climbing up the ladder, people now have to develop a portfolio of skills and products that they can sell directly to a series of customers. We are all becoming people with portfolio careers."
MOONLIGHTING. Thousands of top executives, midlevel managers, and other professionals are already doing just that. They're assembling skills they can market in different industries, joining new networks of professional groups, and checking out key search firms before they're laid off. They're taking interim job assignments and entering the growing ranks of executive and professional temps. They're moonlighting, free-lancing, or starting their own businesses. And they're weaving their own financial safety nets to fill the gaps left by retreating corporate employers.
The Organization Man was a corporate "lifer." But the average American beginning his or her career in the 1990s will probably work in 10 or more jobs for five or more employers before retiring, according to Workplace 2000: The Revolution Reshaping American Business, by Henry Conn and Joseph Boyett at management consultant A. T. Kearney Inc. Says Robert Kelley, author of The Gold Collar Worker and adjunct professor at Carnegie Mellon University: "As companies pull back their loyalty and commitment, middle managers and professional people realize they've got to take care of themselves. They are creating their own survival kits."
But is this breakdown in the bonds of employment good for Corporate America? Can U. S. corporations compete against Japanese and European rivals that often retain the lifelong loyalty and commitment of their employees? "How do you build collaborative effort if everyone in a corporation is working for himself?" asks Kelley. "No other country is playing by these rules. It must be bad for long-term competitiveness."
The long-term impact on many employees isn't good, either. For some, the fall off the corporate ladder may mean a lifetime reduction in real income, benefits, and quality of work--in other words, permanent downward mobility. But for those who adapt, life as an itinerant manager may offer the sort of opportunities for growth, variety, and flexibility that would be impossible within the confines of the corporation.
The most dramatic change is in the definition of work. Jobs are increasingly determined by skills, and titles are meaningless. A resume that reads "Executive Vice-President for Marketing" won't guarantee employment. Companies want people who can solve problems and complete projects. Security derives from the salability of a "can-do" reputation in a job market that spans all industries.
NEW DEAL. That means that the kinds of jobs worth taking have changed, too. "If corporations won't guarantee your employment, they should guarantee your employability," says Rosabeth Kanter, professor of business administration at Harvard business school and author of When Giants Learn to Dance, a book on management and careers in the 1990s. "They must offer individuals the ability to increase their skills and reputation to sell on the market in return for their best efforts."
Take Eckart Vollmer. In 1987, Vollmer was chief financial officer at Gestetner, a $150 million U. S. office-printing subsidiary of a British conglomerate. An Australian group took over and decided to downsize its U. S. unit. Vollmer's position was cut. "I came out in mid-1987 with four children--one still in college," he says. "I was 55." Vollmer found himself with no health benefits and in dire need of income. But he did have something to sell--his skills and experience. He had started out at what was then Peat Marwick, one of the old Big Eight accounting firms, had worked on many financial turnarounds, and had picked up the kinds of contacts that money can't buy.
In 1988, Vollmer was retained as a consultant by Unified Data Products, a $75 million office-forms printer in Riveredge, N. J. Vollmer quickly discovered that the company was running a significant loss. In two weeks, the president resigned, and the chairman asked Vollmer to stay on as acting chief executive. His previous business contacts with CIT Group Inc. and Manufacturers Hanover Corp. helped him secure financing, and his turnaround savvy helped him shut one plant and sell other assets. Today, Vollmer is on a temporary assignment, managing the recent acquisition of Vestron Pictures, a TV and movie company, for Live Entertainment Inc., a home-video distributor in Newbury, Calif.
Vollmer is lucky. His skills are just what the 1990s ordered. After the debt-swamped 1980s, financial doctors who know how to stanch the hemorrhaging of cash are hot. Turnaround artists are at the top of the list, too, as companies struggle to get out of Chapter 11 bankruptcy proceedings. Plant managers with plenty of experience in quality management are in demand as well. And if they have international experience, so much the better. Human-resources managers who have implemented corporate downsizings are also hot. But there's a big supply around, since so many human-resources people are like tree surgeons: Once the damaged limb is gone, they are, too.
Executives who don't yet have the kind of experience and contacts that made the difference for Vollmer can try some profile-raising strategies. Moonlighting, for example. "Moonlighting enhances your self-confidence and your reputation because you sell your skills directly to customers," says London b-school's Handy. "You don't just clock hours sitting."
With new home-office technology, moonlighting is spreading rapidly. But it can be risky. When Robert Hoffman was president of Allen & Dorward Advertising Inc. in San Francisco, he allowed moonlighting because he felt it kept his art directors fresh. But when a moonlighter recruited another employee, started doing outside work on company time, and landed a company big enough to be a possible Allen & Dorward client, he eventually was laid off.
When that happens, of course, you become a full-time moonlighter--also known as an entrepreneur. Entrepreneurs can build new businesses or new, hybrid jobs. Jeneanne Marshall attended the University of Virginia, joined an architectural firm, and switched to commercial real estate. Then, she borrowed $40,000, got a Harvard MBA, and went to Wall Street's PaineWebber Inc. For a year, Marshall worked 16-hour days. Then, just before bonus time, she was fired. "Your job is over," she recalls someone saying. "Leave your office by 5 o'clock tomorrow."
Marshall vowed she would never let a big company humiliate her again. She decided to create her own job. Researching the product-design market, she figured she could teach designers how to sell their skills to business clients and show businesses why they needed designers. Although it took 9 1/2 months, she was hired as the East Coast manager of business development for GVO, one of Silicon Valley's hottest product-design companies. "I now have a clear, adult relationship with a great small company," she says. "If I bring in sales, I get rewarded. I have a lot more control."
Marshall discovered she already had the assets she needed to create her new career. But for those who don't, a midcareer break can recharge batteries, rebuild skills, and improve credentials. Going back to school can often accomplish all three.
BALANCING ACT. Marcia Wochner earned her PhD from the University of Cincinnati in 1979 in both clinical psychology and organizational development. She built her clinical practice first because she had just had a baby. "I knew it would work much better in terms of balancing my whole life when Amy was young. The hours were flexible." When Amy entered first grade, Wochner began a new corporate-consulting business specializing in executive coaching and stress management.
Then, in her mid-30s, Wochner decided to add an MBA to her credentials. "I had the organizational skills but not the understanding of broad business strategy," she says. This summer, Wochner turned 40 and finished her MBA at Southern Methodist University in Dallas. She landed a job as program manager of GE Capital's corporate management-development group in Stamford, Conn., where she is helping to implement CEO John F. Welch Jr.'s "Work-Out" program for eliminating bureaucracy at General Electric Co.
HIRED GUNS. As more managers become itinerants, a new breed of temporary-employment agencies for managers and professionals is springing up. But don't call it temp work: These agencies provide "interim assignments." Even companies looking for permanent executives increasingly insist on "test-driving" prospective hires in interim assignments before making a commitment.
Interim Management Corp. (IMCOR) is typical of the new breed of executive-temp agencies. Based in New York, it was founded in 1988 with offices in Stamford and Los Angeles. Most of its clients take interim assignments as a way to "audition" for permanent jobs, and nearly 40% of IMCOR's assignments do turn into permanent posts.
That's the way it worked for one client, John Scandalios. In the mid-1980s, he led a leveraged buyout of a wire-and-cable company, sold it, and went fishing. By 1989, at age 55, he was bored. Scandalios then took a six-month interim assignment as acting CEO to help turn around RTI Inc., a medical-products sterilizer. He moved the company into the black, and when its delighted board asked him to stay on, he did.
IMCOR also has a large group of clients who no longer want the aggravation of corporate life. They prefer project assignments that last six months to a year. Linda Plevrites, for example, joined Time Inc. in 1964 and rose to comptroller of the magazine division. By the mid-80s, she had had enough. "The whole pressure was on the quarterly numbers," says Plevrites. "I didn't see anything long term. I got disgusted."
In 1988, Plevrites accepted a generous severance package and left after 24 years at Time. "I felt like I'd been let out of prison," she says. Her husband had just sold a restaurant, and they had no children, so they took a six-month vacation in Greece. After that, Plevrites did volunteer work and studied calculus.
IMCOR then found her a typical interim as-signment--an 11-month hitch as comptroller for Saatchi & Saatchi PLC in New York while the advertising giant conducted a search for a permanent comptroller. "I found out there is life after Time," says Plevrites. "I learned that I could walk in and work my way through the financials of any company in any industry." Plevrites is now back at Saatchi for a second one-year interim as-signment as comptroller. "It's wonderful," she says. "I can't be chained up in the corporate world anymore."
But the new world of work is hardly wonderful for everyone--especially those who suffer the trauma of losing a job in a downsizing, only to have it happen again and again. In 1985, Stephen Ness was manager of human resources at the corporate R&D center for Playtex, then owned by Beatrice Co. When Kohlberg Kravis Roberts & Co. did a leveraged buyout of Beatrice, Ness was laid off. He landed a job with Simmonds Precision, an aerospace group owned by Hercules Inc., only to see that position disappear after Hercules sold Simmonds to B. F. Goodrich in January, 1991. At 46 and with a child in college, Ness is job-hunting again--and paying $400 a month for family health benefits. "This kind of life creates a tremendous emotional strain on families," he says.
DEMORALIZING. The trauma can't be underestimated. "In the first round of downsizings in the mid-80s, there was a below-the-surface optimism in the survivors," says Kanter. "They knew there was fat and waste in their corporations. Not now. Layoffs are becoming routine. It's demoralizing for people who feel it's just a matter of time, no matter how well they perform."
More than ever, individuals are on their own, without the security of large, stable organizations. So people are now preparing for a different future. They are redefining and relocating their loyalty--bringing it back to self and family--and they are building personal-survival kits of portable skills and marketable experiences. For all of us, the world of work is being irrevocably transformed.